Argentina's Dairy Industry: A Comprehensive Analysis

Milk Production and Livestock

As of 2023, Argentina boasts approximately 1.6 million dairy cattle, contributing to an annual milk production of about 10.5 billion liters. This impressive output reflects the country's efficient dairy farming practices and favorable climatic conditions.

Milk Processing and Cheese Production

Argentina processes roughly 9 billion liters of milk each year, which highlights its substantial processing capacity. This efficiency is further reflected in the production of approximately 500,000 metric tons of cheese annually.

Milk Powder and Whey Production

The dairy industry also produces around 150,000 metric tons of milk powder and whey each year, catering to both domestic and international markets.

Key Enterprises

• La Serenísima (Mastellone Hermanos S.A.): A leading entity offering a wide range of dairy products.
• Saputo Inc.: A global dairy leader with significant operations in Argentina.
• Williner: Known for its specialization in cheese and other dairy offerings.

Dairy Farms

• Tambos La Unión: A significant dairy farm known for extensive milk production.
• Estancia La Nueva: Another vital contributor to the national milk supply.

Exports and Imports

Argentina exports approximately 3.5 billion liters of milk annually, including products like liquid milk, cheese, and milk powder. Given its substantial domestic production, the country's imports of dairy products remain relatively minimal.

Significant Events in the Dairy Market

• Saputo Inc. Board of Directors Election: Highlights ongoing strategic planning in Argentina’s dairy sector.
• Decline in Dairy Consumption: The IDAA reports significant decreases in consumption, with projections for historic lows in 2024.
• Saputo’s Performance in Latin America: Despite economic challenges, Saputo generated approximately $1.5 billion in revenue from Latin America in 2023.
• Export Growth: Argentina experienced a substantial 50% increase in dairy exports, bolstering its global market position.
• Legal and Market Shifts: Court decisions delaying Bunge’s takeover of Vicentin indicate significant changes impacting the sector.
• Challenges in 2024: A projected 7% decline in milk output due to weather and economic issues, with a noted 13% decrease in the first half compared to 2023.
• EU-Mercosur Trade Deal: A proposed linkage that aims to enhance trade dynamics, with Argentina participating in negotiations.
• Production Recovery: Signs of recovery have emerged despite early declines, although primary supply remains below 2023 levels.
• New Trade Agreement: The EU-Mercosur agreement, involving Argentina, Brazil, Paraguay, and Uruguay, marks a historic achievement.
• Robust Harvests: Exceeded expectations in Argentina, reflecting positive agricultural conditions.
• Milk Prices: Reached historic highs in 2024, raising sustainability concerns with prices at $0.43 per liter.
• SanCor’s Financial Situation: A prominent player facing financial challenges and labor conflicts.
• Market Dynamics: Economic challenges led to the closure of Dánica Dorada’s factory, while Arla Foods Ingredients plans significant investments in Córdoba.
• Suspension of German Imports: Argentina suspended German imports due to a Foot-and-Mouth disease alert issued by the German Ministry of Agriculture.
• Milk Price Stabilization in December: Stabilization in milk prices occurred due to resurgent production, curbing previously exorbitant prices.
• SanCor’s Global Debt: The Argentine dairy cooperative faces a precarious financial situation with a global debt exceeding $400 million.
• Amendment of the Food Code: The Argentine government amended its Food Code to boost trade and industry by optimizing regulatory processes.
• Regional Challenges: The dairy industry in Córdoba and Santa Fe faced a turbulent year in 2024 due to significant production drops.
• Recent developments in Argentina's dairy sector highlight robust growth for companies like Ilolay and Gloria Argentina, while SanCor continues to face challenges exacerbated by Atilra.
• Argentina's butter industry is flourishing amid a global price surge, especially in Santa Fe province.

Modified: 2025/02/05

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